Dell hits revised estimates

Europe is thorn in side

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Dell Computer hit its lowered Q3 targets with a 22 per cent rise in revenues. The company warned that the weak euro continued to hamper sales growth.

Laptops and sales of high-end corporate systems were the engines of growth during the quarter with the lines seeing 50 per cent and 40 per cent revenue growth respectively.

These helped the company reach a record profits, up 40 per cent to $674 million. More than half Dell's revenue and two thirds of operating profit came from sales of enterprise products, notebooks and services, the company said today.

"We're seeing history repeat itself: as they did with desktop PCs, customers of higher-end computing products and services are increasingly choosing to purchase them directly, from Dell," said Michael Dell, Dell chairman and CEO.

Desktops meanwhile are 'still a fairly healthy business' but are becoming a smaller part of the revenue mix, CEO Michael Dell said, in an interview with the FT.

The company expects to hit its revised revenue growth target of 27 per cent for the full year, and it now expects revenues for next year to grow at 20 per cent, still healthy, but rather more sluggish than Wall Street is used to.

Q3 revenues were $8.26 billion, against $6.78 billion a year earlier. Revenues were up 24 per cent in North America and around 40 per cent in the Asia Pacific. But EMEA grew only seven per cent in the quarter.

Last month the Texas-based vendor warned third-quarter revenue would be worse than forecast because of poor sales in Europe and the small business market. ®